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Breaux Crafts Rival Tort Reform Bill

Backers of a bill to send more state class-action suits to federal court are scrambling to kill a nascent alternative floated by Sen. John Breaux (D-La.).

Because a Republican-backed class-action measure could be on the Senate floor as early as next week, business lobbyists and Congressional sponsors of the bill have begun a campaign to discredit the Breaux proposal before the Louisiana Democrat can even officially unveil it.

“There’s a fear that it will siphon off votes” from the original bill, which the Senate Judiciary Committee approved in April, said a Democratic aide to one of the GOP bill’s backers.

Though a handful of Senate Democrats support the original bill, most Democrats oppose the measure and have threatened to prevent the Senate from taking it up. They need 41 votes to do so.

Any defections from the 57 Senators whom lobbyists already count as supporters would only make the job of getting 60 more difficult, they say. Once lobbyists and supporters learned about Breaux’s proposal, they immediately set out to prevent it from gaining momentum.

“We’re just trying to be proactive … to make sure people don’t see the Breaux proposal as a compromise,” said the Democratic aide. “On this issue, [Breaux’s] in bed with the trial lawyers.”

Trial lawyer groups strongly oppose the Judiciary-approved class action bill because they say it is intended to move such suits into federal courts in the hopes of reducing settlements and damage awards.

“The advocates of the bill that came out of committee aren’t interested in addressing the problems they say exist [with the class-action system]. They’re only interested in protecting corporate wrongdoing,” said Carlton Carl, spokesman for the Association of Trial Lawyers of America.

But proponents contend that some lawyers “forum shop” their lawsuits to find states — such as Texas, Mississippi and Florida — that are apt to award more money in damage awards to class-action plaintiffs. Because of a glitch in current federal law, even when class-action suits have plaintiffs from different states, they are not always sent to federal courts.

So far, the Breaux alternative has been shopped around only as a set of principles and has not yet been converted into legislative bill language.

“We’re still very much in the discussion phase on this,” said Breaux spokeswoman Bette Phelan, who appeared surprised that the Senator’s embryonic proposal was garnering so much opposition.

But class-action supporters are so worried about the unwritten measure that they asked Walter Dellinger, a prominent lawyer at O’Melveny & Myers and a consultant for the U.S. Chamber of Commerce, to examine the summary that Breaux has floated.

“The substitute would allow attorneys to continue manipulating class-action pleadings to easily avoid federal jurisdiction and thereby keep virtually all class actions in the state courts where the serious abuses are occurring,” Dellinger, a former acting U.S. solicitor general during the Clinton administration, wrote in a five-page letter to original bill backer Sen. Tom Carper (D-Del.).

But opponents of the class-action measure say Dellinger’s comments and the intense lobbying effort against Breaux only reveal the weaknesses of the bill’s supporters.

“Given the magnitude of attention on a bill that no one has seen suggests that the 500 corporate lobbyists who are pushing this are worried. And they probably should be worried,” Carl said. “I’m confident that they won’t get the 60 votes that they need.”

According to a summary of Breaux’s proposal, it would require courts to only consider whether the plaintiffs in the initial filing of the suit were made up primarily of citizens of the state in which the suit was filed. The Judiciary-approved bill would apply to class actions at any stage in the process if the plaintiffs’ list grows to include more people from outside the state in which the suit was filed.

The lobbying campaign against Breaux, ironically, also dovetails with Carper’s efforts to broker a way for the bill to come before the Senate without being filibustered.

Carper said he had serious problems with Breaux’s proposal and will try to defeat it, but he said he hoped to convince Republicans to allow Breaux and other dissenters to offer amendments in the hope that an open-floor debate would garner more votes against a filibuster.

“The best way for us to get to cloture is for people who have amendments to have a chance to offer those amendments,” Carper said.

Carper has been actively lobbying fellow Democrats to abandon plans for a filibuster, while simultaneously arguing with Republicans to hold off on their tentative plans to shut down debate by filing a cloture motion — or motion to limit debate time. Carper said neither side had agreed with him yet.

Carper said he also plans to lay down a marker, along with other centrist Democrats and Republicans supporting the bill, to prevent Senate negotiators on the measure from agreeing to provisions in a House-sponsored version — assuming the Senate passes its version and the measure goes to conference committee.

Specifically, Carper opposes language in the House bill that would allow the provisions of the measure to apply retroactively.

“We will prepare a letter to our leadership and the House leadership … that we will not support a conference report that tilts toward the House bill,” said Carper. “If we pass a bill in the Senate and end up with a bad conference report, then it’s really a Pyrrhic victory.”

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